Day after Budget, rupee marks highest single-day gain in 6 weeks

A day after the Union Budget 2026 was announced, the rupee on Monday gained 42 paise to settle at 91.51 (provisional) against the US dollar, marking its strongest single-day rise in more than six weeks.

The Reserve Bank of India (RBI) appeared to be firmly defending the 92 per dollar level, according to forex traders. Also, the rise in currency was due to a drop in crude oil prices from their high levels.

For market watchers, the rupee rebounded drastically during the afternoon session amid continued dollar selling by state-owned banks, largely believed to be acting on behalf of the RBI, which helped mitigate volatility and stabilise market sentiment.

The rupee began trading at 91.95 against the US dollar on the interbank foreign currency market. It then gained some ground to reach an intraday high of 91.45 and a low of 91.95 against the US dollar.

At the end of the trading session on Monday, the rupee was quoted at 91.51 (provisional) against the US dollar, registering a gain of 42 paise from its previous level.

Many experts feel that RBI was in the spotlight from the beginning today and made sure that 92 is not breached again. The budget provided certainty rather than comfort for the rupee.

Although there may still be short-term pressure, medium-term prospects are positive due to the larger message of financial credibility and growth continuity.

Indian bourses had tumbled on Sunday after the announcement of the budget, in which the government significantly increased the Securities Transaction Tax (STT) on trading in the Futures and Options (F&O) segment of the derivative market to strengthen its grip on restricting speculative activity.

Foreign investors net sold $4 billion of Indian stocks in January, with continuous selling impacting on the rupee.

In the meantime, a persistent selloff in precious metals on Monday rattled global markets, driving investors to sell other assets to offset losses.